The Australian dollar tried to rally during the day, and then turned around to sell off rather drastically. Because of this, the 0.7575 level was tested, and I think that is a massive amount of support. A breakdown below there should send this market down to the 0.7550 level, an area that has been interesting in the past. If we bounce, I believe that the market should continue to reach towards the 0.765 handle after that. I think that the market break into the upside should send this market to the 0.7750 level. Ultimately, this is a market that continues to follow risk appetite, so keep an eye on what happens there. The New Zealand Central Bank of course has an interest rate statement coming out today, and the Australian dollar can often follow in sympathy.
Gold markets continue to be very negative, and that of course ways upon the Australian dollar as well. Because of this, I think we may go looking for support underneath, at least before we can bounce somewhat. I believe that the market will continue to be very difficult to deal with, as there are so many moving pieces when it comes to the Federal Reserve looking at raising rates. On top of that, the influence of gold and of course the overall outlook of risk appetite will continue to cause havoc in this market. With all of these things being equal, it’s difficult to figure out where we go next, so I assume that the consolidation overall continues. After all, things change only when they do.
Written by FX Empire